Mike Wagner, president and CEO of Target Freight Management, is a 2017 Pittsburgh Smart 50 honoree
In the midst of the Great Recession, Mike Wagner quit his six-figure sales job to start a third-party logistics company.
“I didn’t feel like I was getting a return on the revenues that I was generating for those companies,” he says. “I’ve never really been a good employee. I’m more somebody that needs to work for myself.”
A friend gave him investment money, and eight months later, Target Freight Management was profitable. But while the president and CEO was used to sales, developing a back-end operation was daunting.
“We had no issues bringing on business. Our issues were once we brought all that business on, efficiently managing it and making sure everything was accurate to get it back to customers,” Wagner says.
Evolve with a changing market
In addition, soon after TFM started, the National Motor Freight Traffic Association began to favor density-based ratings because carriers were losing money. The focus was on space more than weight. A 2,500-pound pallet might cost less than a 200-pound pallet because another pallet could be stacked on it.
With customers scrambling to accurately quote freight, TFM ultimately built patented software around the density rules and regulations.
“I never would have envisioned being a software development company,” Wagner says.
He now runs Freight Innovation Density Analytics, along with another separate company, the brokerage TFM Truckload LLC.
Recently, FIDA developed a loading dock apparatus that uses lasers and infrared cameras to accurately measure freight. Once complete, the application will integrate with the business management software of 3PLs or large manufacturers.
TFM’s growth to a $70 million-a-year company with 46 employees hasn’t been without its hiccups, though. The danger is getting tunnel vision.
“We’ve been better at managing both sides, being almost 10 years old now, but there were definitely bouts of both — where you’re growing way too fast, you shore up the operation; now you’ve focused too much on operations, your sales haven’t been growing nearly as much,” Wagner says.
However, Wagner takes pride in how much his employees accomplish, after starting his career at large corporations.
“I’d rather pay people more money and (have them) wear multiple hats,” he says. “They get to share more of the pool, rather than water it down with a bunch of additional people who aren’t going to be paid as much and maybe aren’t going to be as motivated to come to work every day.”